Rubbish savings rates

wmb194

You need to be more specific: do you mean the *best* easy or instant access accounts with no deposit, withdrawal or balance restrictions?

As pointed out, there are savings accounts that pay more than Bank rate. It's just that you don't seem to like them.

Either way, as other posters have said, there's never been a direct, mechanical correlation between Bank rate and deposit rates. It usually depends on how stressed the market is.

jimjames

dosh37 said:

I don't remember a time when savings interest rates were actually below the BoE interest rate.

Why is this happening?

I think you're looking in the wrong place. Pre 2008 savings rates were normally below Base rate though.

RG2015

dosh37 said:

My original question has not been answered.

All I have seen are responses telling me that 'savers have never had it so good'.

This is clearly rubbish (probably trolls).

Does anyone have a sensible answer?

I have answered the question.

I don't remember a time when savings interest rates were actually below the BoE interest rate.

Why is this happening?

Because the banks currently don't need any more money.

dosh37

RG2015 said:

dosh37 said:

RG2015 said:

dosh37 said:

I don't remember a time when savings interest rates were actually below the BoE interest rate.

Why is this happening?

It may sound simple, but the banks and building societies don't want to give away too much when they have enough funding for their plans.

That said, First Direct are offering a 7% account which the highest rate seen for several years. And this is not the only one as the list below shows.

First Direct RS 7%
Club Lloyds RS 5.25%
NatWest/RBS RS 5%

Barclays Rainy Day instant RS 5%

Virgin Money instant flexible ISA 3%

And what is the maxiumum amount you can invest in these high interest accounts?

I am guessing that is a rhetoric question and I take your point, but banking is a business like any other.

They want to make money not give it away. Without being too coarse, they don't give a stuff about customers and even less about the BoE base rate,

If they need more money they look to the cheapest option be it customers of the Bank of England. As to the BoE rate hikes, the commercial banks have factored in all of these rate rises ages ago.

Their aim is financial as opposed to the BoE which is political, purely based on the narrow goal of 2% inflation.

Understood.

The best answer thus far.

As I suspected, savers are screwed - methinks more beer and hookers.

wmb194

If you compare the Swanlow Park data with the Bank Rate's history it looks like, for instant access, it's sometimes above and sometimes below. The Swanlow Park data isn't necessarily indicating the the best available rates, though.

You can put these data together to make a chart if you're really interested.

https://www.swanlowpark.co.uk/savings-interest-data

https://www.bankofengland.co.uk/boeapps/database/Bank-Rate.asp

dosh37

wmb194 said:

If you compare the Swanlow Park data with the Bank Rate's history it looks like, for instant access, it's sometimes above and sometimes below. The Swanlow Park data isn't necessarily indicating the the best available rates, though.

You can put these data together to make a chart if you're really interested.

https://www.swanlowpark.co.uk/savings-interest-data

https://www.bankofengland.co.uk/boeapps/database/Bank-Rate.asp

hmm - the Swanlow Parks links give a Firefox security risk. Not exactly confidence inspiring.

I'm not really surprised by the quality of responses on MSE.

wmb194

dosh37 said:

wmb194 said:

If you compare the Swanlow Park data with the Bank Rate's history it looks like, for instant access, it's sometimes above and sometimes below. The Swanlow Park data isn't necessarily indicating the the best available rates, though.

You can put these data together to make a chart if you're really interested.

https://www.swanlowpark.co.uk/savings-interest-data

https://www.bankofengland.co.uk/boeapps/database/Bank-Rate.asp

hmm - the Swanlow Parks links give a Firefox security risk. Not exactly confidence inspiring.

I'm not really surprised by the quality of responses on MSE.

It's fine for me on my iPad. The truth is, it's seems you're in a bad mood and don't want to hear any answers. 

You still haven't clarified what you're really asking: actually only interested instant access rates?

k12479

dosh37 said:
I'm not really surprised by the quality of responses on MSE.

So ask for a full refund.

RG2015

I believe that this thread raises a very important point and that is the link between the BoE base rate and savings rates. And for the avoidance of doubt, I will limit this to unrestricted, instant access, variable rate savings accounts.

I will also ignore the fact that the BoE rate also affects borrowing rates such as mortgage and loan interest payable. This is clearly part of the consideration of the BoE when setting rates, but let's just park that as a deviation on a savings and investment board.

Banks will clearly be influenced by the BoE rate, but this is just one of many factors in their calculations. They are not obliged to link their rates to the BoE rate, but if it forms part of their borrowing plan they cannot ignore it.

They will have a financial plan for the short, medium and long term. This will determine their borrowing and sales requirement.

This is incredibly complex. If all they did was link their savings rates to the BoE rate they could programme a computer to do this.

To provide a conclusion without re-writing War and Peace, the banks will set their mainstream interest rates at the level they determine will best suit their business goals. 

jak22

It's a valid question as far as instant access - I think in the past we've seen savings returns above the base rate but now banks seem to improve rates only when they need to or for marketing. Fixed reflect future rates so aren't the issue. The thread title isn't quite fair though as we're getting the highest rates ignoring inflation for a long time. But again we see some upvoted unhelpful responses.